Franklin Templeton Investments is seeking approval for a Dublin domicile and listing for a mirror ...
Franklin Templeton Investments is seeking approval for a Dublin domicile and listing for a mirror version of its US- registered Templeton Global Long/Short Equity fund, to be launched into Europe in October.
Dale Winner, manager of the £106.9m fund, said it draws on research from 35 in-house sector analysts to select long positions. These stocks Winner characterises as 'value with a catalyst'.
He said: 'We are looking for normalised earnings and cashflow power, generally looking three-to-five years out.'
On the short side, Winner said, the fund does not invest for defence. 'Shorts are offensive plays we believe will make money whether the market goes down or up,' he noted.
Winner emphasised the fund does not simply short high P/E stocks ' the opposite of value-driven longs ' but seeks other reasons for stocks falling, using the same bottom-up process it employs for long positions.
The fund was net short US stocks at the end of August because of valuations, little pricing power and poor earnings prospects. But it remained net long where pricing power existed among insurance, healthcare and defence. The fund is net long emerging markets for its 'phenomenally cheap' valuations, with the MSCI Emerging Markets Index trading at less than 10 times earnings.
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